Neogen Corporation (NEOG)

Payables turnover

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Cost of revenue (ttm)	US$ in thousands	932,892	915,465	935,907	830,479	723,301	622,394	482,567	463,396	446,232	425,625	403,608	387,925	369,635	355,939	349,990	344,910	346,791	343,600	343,535	342,391
Payables	US$ in thousands	89,748	112,184	90,210	76,669	60,494	79,251	27,002	34,614	23,548	34,222	22,414	23,900	23,257	20,697	22,537	25,650	18,994	19,567	18,345	19,063
Payables turnover		10.39	8.16	10.37	10.83	11.96	7.85	17.87	13.39	18.95	12.44	18.01	16.23	15.89	17.20	15.53	13.45	18.26	17.56	18.73	17.96

February 29, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $932,892K ÷ $89,748K
= 10.39

Neogen Corporation's payables turnover ratio has shown fluctuations over the recent periods, indicating variations in the efficiency of managing its accounts payable. The payables turnover ratio measures how many times, on average, the company pays off its suppliers in a given period.

In the most recent period of Feb 29, 2024, the payables turnover ratio stood at 10.39, indicating that Neogen Corporation paid off its suppliers approximately 10.39 times during the year. This represents an improvement from the previous period, Nov 30, 2023, where the ratio was 8.16.

Looking back over the past few years, there have been instances of both increases and decreases in the payables turnover ratio. For example, in Aug 31, 2022, the ratio spiked to 17.87, signifying a higher frequency of paying suppliers, possibly due to changes in payment terms or efficiencies in the accounts payable process.

Overall, the trend in the payables turnover ratio for Neogen Corporation suggests that the company has been managing its accounts payable efficiently, with some fluctuations reflecting changes in payment practices or supplier relationships. It is important to continue monitoring this ratio to ensure a balance between timely payments to suppliers and maintaining healthy cash flow levels.